The Victorian Government released the first Critical Minerals Roadmap (Roadmap). The Roadmap presents a plan to enhance Victoria’s position as a key player in the race to produce critical minerals in response to soaring global demand for these resources. See our recent insight on the rising demand for critical minerals.
The release of the Roadmap is a significant milestone and a clear signal from Government that a thriving critical minerals industry is a key priority in the move towards a net zero economy. To that end, the Roadmap proposes a wide suite of policy reforms aimed at improving efficiencies for critical minerals projects to capitalise on Victoria’s endowment of globally significant deposits of critical minerals. The release of the Roadmap comes at a crucial moment as the demand for critical minerals is projected to increase sixfold by 2040, which equates to around $2.5 trillion in global mining investment and over 3 billion tonnes of metals. The Roadmap seeks to ensure Victoria is prepared to leverage this surge in demand and to support its rise as a global producer of ethically-produced critical minerals.
Below we provide a snapshot of key parts of the Roadmap and our insights.
Roadmap Themes
The Roadmap outlines actions the Victorian Government will undertake over the next 12 months across four key themes. Under each theme, a range of specific initiatives are set out alongside other broader aspirations to be developed in due course:
- Mapping the Opportunities – Identify and promote new critical minerals by modernising geoscience data and new technologies to undertake land use assessments to identify suitable Critical Minerals Priority Development Zones (Priority Zones).
- Modern and Robust Regulatory Regime – Establish a Victorian Critical Minerals Coordination Office (CMC) to reduce approval timeframes and assist with the implementation of a duty-based approvals model for exploration and mining.
- Critical Minerals Production and Processing – Investigate production opportunities in critical minerals processing and manufacturing, including national security benefits. To that end, a Critical Minerals Advisory Group will be formed to advise on the establishment of a critical minerals downstream industry in regional Victoria and to investigate potential opportunities for Victoria to become part of a national critical minerals supply chain.
- Share the Benefits of Victoria’s Minerals – Investigate benefit sharing opportunities as an integral feature of the Victorian critical minerals industry to encourage positive and equitable social, environmental and economic outcomes as between different stakeholders.
The Roadmap is intended to be a live plan that is regularly reviewed and updated to reflect evolving circumstances. Whilst the Roadmap is presently focused on initiatives proposed over the course of the next 12 months, it is intended that longer-term strategies will be developed and included at a later date.
Priority Zones
A key part of Theme 1 (Mapping the Opportunities) of the Roadmap is the announcement that the Victorian Government will introduce Priority Zones across Victoria. Priority Zones will earmark new regions for critical minerals development with a view to increasing investor confidence and to streamline approval processes. Strategic land use assessments will be undertaken by Resources Victoria to identify areas with high likelihoods of developing successful critical minerals projects. At this stage, no details have been released regarding any complementary amendments to planning controls to facilitate the creation of Priority Zones and project development in these areas.
The Roadmap provides that north-west Victoria has been ear-marked for a strategic land use assessment pilot to define Priority Zones. The Government will utilise a multi-criteria analysis as part of this assessment to identify areas suitable for future development of mineral sands projects.
The Victorian Government has established a Whole of Government Critical Minerals Taskforce, led by Resources Victoria, to coordinate and guide the Government’s policy actions within the Priority Zones. In addition, the Government has committed to expanding its applied geoscience capabilities to assist with identifying Priority Zones.
A related development under the Roadmap is the commentary made in respect of the exemption power under section 7 of the Mineral Resources (Sustainable Development) Act 1990 (Vic) (MRSD Act). This provision gives the Minister for Energy and Resources a broad power to exempt land from minerals exploration and development. The Roadmap provides that a clear policy and criteria will be developed for identifying and designating regions where mineral exploration and development are considered unsuitable and consequently should be prohibited under section 7 of the MRSD Act. In our view, the introduction of a transparent policy with respect to the use of the exemption power is a welcome development and will greatly assist industry and other stakeholders to understand regulatory decision-making more effectively and plan accordingly.
Finally, the Roadmap provides that possible future initiatives include the development of a co-existence policy to address the increasing intersections, and sometimes land use conflicts, between critical minerals projects, renewable energy projects, and the agriculture sector. This is another very welcome development which will provide much-needed clarity and guidance on the live issue of how potential land-use conflicts can and should be resolved. We look forward to seeing further details be released in respect of this policy and further guidance in respect of land use co-existence, which may also have potential implications in relation to Priority Zones and the land use exemption under the MRSD Act referred to above.
Streamlining Approvals for Critical Minerals Projects
A key focus of the Roadmap is on establishing a modern and robust regulatory regime for critical minerals projects. This comes off the back of the introduction of a duty-based regulatory system for exploration, mining, and extractive industries under the Mineral Resources (Sustainable Development) Amendment Act 2023 (Vic) (Amendment Act), which is set to come into effect in 2027. You can find more information about the new duty-based framework under the Amendment Act in our previous insight piece.
To that end, the Victorian Government will establish the CMC within Resources Victoria to build on the work of the Resources Victoria Approvals Coordination (RVAC), but with a specialised focus on critical minerals projects. As a starting point, Resources Victoria will provide more detailed guidance on application requirements to ensure applications are comprehensive and include all required materials. RVAC will be extended until 2027 to continue supporting greater efficiency in case management of approvals. This will be welcomed by many clients and industry participants, who have found the creation of RVAC to be a helpful enabler to development, by removing uncertainty around resource approvals.
Significantly, the Roadmap comments on the need to optimise the environment effects statement (EES) process under the Environment Effects Act 1978 (Vic). The EES process has been a notorious source of uncertainty and delay for critical minerals project proponents (and major projects proponents more generally). The Roadmap refers to the Government's recently released Economic Growth Statement which includes a commitment to ensuring that the EES can be completed with 18 months. This streamlined process will be achieved through:
- refined assessment scopes;
- better utilisation of Environmental Reports;
- increased support for applicants; and
- streamlining the public engagement process by facilitating online engagement and targeted public inquiries and engagement phases.
These reforms are expected to significantly reduce approval timeframes for proponents by an average of 16 months, saving businesses an estimated $155 million per year in avoided costs.
This development in respect of the EES process coincides with the release of the Victorian Minister for Planning's assessments following the EES processes for the WIM Resources Avonbank Mineral Sands Project and Goschen Mineral Sands and Rare Earths Project in the same week. In both cases, the Minister's assessment found overall that none of the environmental effects assessed could or should result in the project not proceeding. These positive assessments are the first mineral sands projects to obtain favourable outcomes from the EES process since 2008. Subject to the implementation of recommended environmental management measures, these projects can now proceed to obtain necessary primary and secondary approvals. Taken altogether, the outcome of the EES process for these projects coupled with a commitment to a more efficient and streamlined pathway for future proponents is a major turning point for the critical minerals industry as a whole. In our view, a more efficient EES process will be a significant driving force in assisting Victoria to reach its potential towards shaping a prosperous, sustainable future for all Victorians, with lasting social and economic benefits for regional communities and Traditional Owners.
Traditional Owner Engagement and Benefit Sharing
Effective and meaningful benefit sharing is a strong focus of the Roadmap.
The Roadmap encourages proactive and continuous dialogue with Traditional Owners to ensure that considerations of Aboriginal cultural heritage are integrated from the earliest phases of strategic project planning for critical minerals projects. The Roadmap provides that Resources Victoria will collaborate with Traditional Owners to explore possibilities for a specialised benefit-sharing model, pinpointing primary issues and prospects for both monetary and non-financial opportunities that may arise from critical minerals activities. A separate community benefit sharing model will be developed for local communities.
We observe that this strong focus on benefit sharing in the Roadmap is aligned with the broader emphasis that has been placed to date on benefit sharing being a key tenet of major project developments. For example, earlier this year VicGrid released the draft Renewable Energy Zone Community Benefits framework which is proposed to form part of the Victorian Transmission Investment Framework. We note the Clean Energy Council has also previously released detailed guidance on benefit sharing options for renewable energy projects.
Whilst the Roadmap emphasises the bespoke nature of effective benefit sharing and that this exercise must be primarily context-driven, at a macro-level we consider the focus on this concept in the Roadmap is another indication that benefit-sharing is speedily becoming an entrenched principle in all major project developments, and will evidently form part of the foundation of future critical minerals projects in Victoria.
Employment
To ensure Victoria’s critical mineral industry is supported by a highly skilled workforce with specialised expertise in critical minerals, the Roadmap provides that Government will look to partner with industry bodies to identify long-term solutions, including potentially an audit of required skills and training options for the State's key critical minerals regions. The growth of the Victorian critical minerals industry, bolstered by the initiatives set out in the Roadmap, will undoubtedly generate employment opportunities, training pathways and economic potential for local businesses across regional Victoria. In turn, this will likely assist in facilitating a positive shift in community sentiment and acceptance of the benefits these projects can produce at local, regional, national and international levels.
Final thoughts
The Roadmap heralds a new era for the critical minerals industry in Victoria. By embracing a more supportive stance, the Government has not only acknowledged the sector's vital role in our future economy but has also laid the groundwork for a more harmonious relationship with other stakeholders. This strategic shift is poised to bolster industry confidence, catalyse investment, and facilitate the development of new projects, all while ensuring environmental and community interests are addressed.
The Government's release of the Roadmap could help to shift the dial on some public perceptions on mining, given public perception often takes cues from official policy. With a more informed and balanced dialogue surrounding the industry's growth, Victorians are likely to see critical mineral projects not as intrusions, but as integral components of our nation's progress and prosperity.
The policy change signals more than just a change in stance on policy settings; it represents a forward-thinking commitment to securing Australia's economic future in the global market. As the world increasingly turns to sustainable and technologically driven solutions, Victoria’s critical minerals industry stands ready to play a meaningful role.
Please reach to discuss how we can assist your organisation with critical minerals exploration or development projects in Victoria, in light of the opportunities presented under the Roadmap.
